Lenders consider credit scores when deciding who they’ll approve for credit—and in other decisions as well. Your score can affect your finances in several ways, so it’s important to know the benefits of having a good credit score.
What is a good credit score?
While there are countless credit scoring models on the market, many top lenders use FICO® Scores,* which assign scores in a range of 300 to 850. FICO® Scores are categorized into the following credit scoring bands:
| Exceptional | 800 and above |
| Very good | 740 to 799 |
| Good | 670 to 739 |
| Fair | 580 to 669 |
| Poor | 579 and below |
Savings on interest
Borrowers with the highest credit scores generally have access to the lowest interest rates available on mortgages and auto loans, and a lower rate can translate to big savings.
When financing a big purchase, small differences in the financing rate can translate into thousands (or tens of thousands) of dollars in interest charges over the life of the loan.
Better terms and access to loan products
Lenders may use credit score “cut offs” as preliminary eligibility screens when deciding what type of loan they will offer. Each lender sets its own lending criteria, but, for example, a hypothetical mortgage issuer might have a policy of refusing loan applicants with FICO® Scores below 620, offering only adjustable-rate mortgages to applicants with scores between 620 and 699, and fixed-rate loans only to applicants with scores above 700.
Access to the best credit card rewards
Credit card issuers use credit score cut-offs in decisions about which cards you qualify for. When you receive a prescreened credit card offer, it’s possible that your credit scores indicate a better chance of qualifying for the card.
Offers for the most exclusive rewards cards—the most generous mileage, points or cash back rewards are typically only available to borrowers with high credit scores.
Note that a good score may not guarantee approval for these offers—card issuers, like other lenders, typically consider your income and other debts as well as scores when making credit offers.
How to improve your credit score
To improve your credit, you’ll need to demonstrate that you can manage your credit responsibly. You can do this by making every payment on time, keeping card balances low and taking other steps to improve your credit health.
Don’t miss payments – your payment history is the most important factor in determining your credit scores.
Pay down revolving account balances – high balances on credit cards and other revolving credit accounts elevate your credit utilization rate and can hurt your credit scores.
Catch up on past-due accounts – a late payment can remain on your credit report for up to seven years, so bringing any past-due bills current can help your credit score.
Limit new credit applications – each credit application you submit can lead to a hard inquiry that lowers your credit scores. Opening multiple new accounts can also decrease the average age of all your accounts, which can also hurt your scores.
For more information on improving credit, see the following articles:
- How can I increase my credit score?
- Credit repair tips
- How long after you pay off debt does your credit improve?
Barclays offers card customers online access to their FICO® Credit Score at no cost. Follow this link to log in and view your score.**
*FICO® is a registered trademark of Fair Isaac Corporation in the United States and other countries. Barclays and Fair Isaac are not credit repair organizations as defined under federal or state law, including the Credit Repair Organizations Act. Barclays and Fair Isaac do not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history or credit rating. FICO and “The score lenders use” are registered trademarks of Fair Isaac Corporation in the United States and other countries.
A credit score is a 3-digit number calculated using information on a credit report that serves as a numerical representation of a person’s creditworthiness. A credit report is a summary of your credit activity such as the payment history and status of your credit accounts which potential lenders use to offer you credit and on what terms. Your FICO® Credit Score and key factors are based on data from third-party providers who are not affiliated with Barclays. Barclays does not guarantee the accuracy of any credit information that is provided to you by these third parties.
**FICO® is a registered trademark of Fair Isaac Corporation in the United States and other countries. Barclays offers FICO® Score access at its sole discretion. Not all accounts will have a FICO® Score available. FICO® Score access is not a permanent feature of your account and may be removed at any time. To view your FICO® Score, your account with us must be open, active (having activity within the past 150 days) and in good standing.